A board-ready capital allocation case for risk decisions. The deliverable mirrors the Authorization for Expenditure document a CFO already signs for capex — same structure, same financial summary, same approval ask. Where you have an internal AFE template, the firm mirrors it.
Each Risk AFE evaluates your current risk program alongside a modeled alternative. Five methods run on both. The recommendation arrives with a confidence range rather than a point estimate.
Present value of after-tax cash flows over the planning horizon, discounted at your company's published hurdle rate.
Internal rate of return on the incremental investment, evaluated against the same hurdle rate threshold used for every other capital allocation decision.
Payback period for the incremental investment — the year the recommended risk posture pays for itself in modeled cost recovery.
Tornado chart identifying which inputs most affect the answer. You see immediately which assumptions carry the weight.
Discrete downside, base, and upside cases, extended probabilistically through Monte Carlo simulation to a 10,000-path distribution. Tells you how robust the recommendation is when inputs move outside the base case — the difference between a confident decision and a fragile one.
Two deliverables complete the engagement after the AFE is approved and bound. The Variance Bridge reconciles the bound program against the approved AFE within the binding cycle. The Risk Capital Value Bridge decomposes realized engagement value annually. Both get full concept-layer treatment in the sample Risk AFE walkthrough.
Annual binding-cycle waterfall tracking variance between the approved Risk AFE and the bound renewal program. Tells you whether the program you bound matches the program you approved, and where the variance came from.
Annual horizontal waterfall decomposing realized engagement value. Shows in one chart what recovery the engagement actually delivered — by line item, not in aggregate. At sale, this is the document you hand the acquirer's deal team — formatted to defend multiple expansion in the same language they already use to value your business.
Lower EBITDA volatility correlates with higher EV/EBITDA multiples. The Risk AFE translates the volatility delta into a directional enterprise value sensitivity range using the Damodaran NYU dataset for your industry. Sensitivity range, not a point estimate. The output is what risk reduction is worth at exit, in enterprise value — not just in premium savings.
A 30 to 60 minute conversation about your business, your current risk program, and how we work. No fee. No pitch.
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